January 26, 2016

Ahead of Apple's financial conference call that's scheduled for 2:00 p.m. PT / 5:00 p.m. ET today, a new report this morning is claiming that Apple will announce that its iPhone sales were the slowest in their history at approximately one percent over last year. This compares with a nearly 46 percent year-over-year jump in iPhone sales in the first quarter of 2015. To date, the slowest growth in quarterly iPhone sales had been 6.8 percent for the second quarter of fiscal 2013, according to data from Statista.Analysts estimate Apple sold 75.5 million iPhones in the October-December quarter, a 1.3 percent increase from a year earlier, according to research firm FactSet StreetAccount.

The Reuters report further noted that "The iPhone 6S and 6S Plus, which boasted record weekend sales when they launched in September, are now facing weak demand, according to analysts, because they have fewer distinguishing features than their popular predecessors.

Reuters is also forecasting that "Apple is expected to forecast a drop in iPhone sales for the March quarter – the first time that sales will fall since the iPhone was launched in 2007." The forecast for next quarter iPhones sales is the key that all will be listening for in the conference call today.

Reuters further notes that Analysts are saying that "the company will have to wait until the launch of the iPhone 7, expected later this year, to return to growth, as buyers upgrade to the latest version." That of course could change rather quickly if the rumored lower priced 4" iPhone model surfaces this spring as expected.

While we'll see later today if the Reuters report is accurate, we have to acknowledge that Apple's 46% growth last year was a staggering achievement for a product line that began in 2007. It was also an all-new model which is always a better seller than its follow-up model. And so, despite the challenge of facing such a wall of growth to overcome, even a one percent growth factor should be applauded.

In contrast, Samsung is widely expected to have another missed quarter in-part due to falling smartphone sales as noted in our January 8 report titled "Another Quarter Goes by and Samsung's Recovery is nowhere in Sight."

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